An anonymous cryptocurrency trader has accumulated almost $68 million in unrealized profit by shorting Ether amid its recent price decline.

The trade involved shorting 70131 ETH, worth more than $155 million at current prices. In addition to the unrealized gains, the trader also earned $3.2 million in funding fees.

An anonymous cryptocurrency trader has accumulated almost $68 million in unrealized profit by shorting Ether.

According to blockchain data from Hypurrscan, the trader opened a 50x leveraged short position when Ether (ETH) was trading at $3,176, on Feb. 1. As of 9:06 am UTC on March 5, the position had almost $68 million in unrealized profit.

Shorting involves “borrowing” the underlying cryptocurrency from a broker, selling it at the current price, and then repurchasing it once the price falls — a strategy used by traders to bet on the price decline of an asset.

The trade involved shorting 70,131 ETH, which is currently worth more than $155 million. In addition to the unrealized gains, the trader also earned $3.2 million in funding fees. However, the position is at risk of liquidation if Ether’s price rises above $3,460.

ETH/USD, 1-month chart. Source: TradingView

The lucrative short position came during a period of heightened volatility in the crypto market. The industry recently suffered its largest-ever hack, with Bybit losing $1.4 billion, alongside broader macroeconomic factors, which saw Ether’s price decline nearly 11% over the past week, according to data from Cointelegraph Markets Pro.

Can Ether recover above $3K after Bybit’s massive $1.4B hack?

Ethereum’s Pectra upgrade may lay groundwork for next Ether price rally

The profitable short trade comes during an exciting period for Ethereum’s development, as the Pectra upgrade went live on its final testnet on March 5, according to Cointelegraph.

Ethereum’s forthcoming Pectra upgrade could help lay the groundwork for the next Ether rally by helping ease long-term selling pressure, according to Gabriel Halm, a research analyst at blockchain intelligence firm IntoTheBlock.

“By reducing consensus overhead and boosting L2 scalability, it will expand the network’s overall capacity, thereby enhancing its competitive edge,” added the analyst.

The Pectra upgrade bundles several proposals, including EIP-7251, which will increase the validator staking limit from 32 ETH to 2,048 ETH, making it easier for validators to compound their earnings, potentially reducing sell pressure over time.

However, the upgrade was activated on the Holesky testnet on Feb. 24 and failed to finalize. This may mean Ethereum developers will further delay the mainnet launch as they investigate the issues.

Investors can expect more information on the final date of the Pectra mainnet implementation on March 6 during Ethereum’s All Core Developers call.